Industry Analysts Just Upgraded Their Bicycle Therapeutics plc (NASDAQ:BCYC) Revenue Forecasts By 26%

Celebrations may be in order for Bicycle Therapeutics plc (NASDAQ:BCYC) shareholders, with the analysts delivering a significant upgrade to their statutory estimates for the company. The revenue forecast for this year has experienced a facelift, with the analysts now much more optimistic on its sales pipeline. Investor sentiment seems to be improving too, with the share price up 7.0% to US$21.77 over the past 7 days. It will be interesting to see if this latest upgrade is enough to kickstart further buying interest in the stock.

After the upgrade, the 14 analysts covering Bicycle Therapeutics are now predicting revenues of US$20m in 2023. If met, this would reflect a sizeable 41% improvement in sales compared to the last 12 months. Per-share losses are expected to explode, reaching US$4.60 per share. Yet prior to the latest estimates, the analysts had been forecasting revenues of US$16m and losses of US$4.63 per share in 2023. So there's been quite a change-up of views after the recent consensus updates, withthe analysts noticeably increasing their revenue forecasts while also expecting losses per share to hold steady.

See our latest analysis for Bicycle Therapeutics

The consensus price target held steady at US$52.79 despite the upgrade to revenue forecasts and ongoing losses. Analysts seem to think the business is otherwise performing roughly in line with expectations. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. The most optimistic Bicycle Therapeutics analyst has a price target of US$72.00 per share, while the most pessimistic values it at US$33.00. This is a fairly broad spread of estimates, suggesting that the analysts are forecasting a wide range of possible outcomes for the business.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that Bicycle Therapeutics' rate of growth is expected to accelerate meaningfully, with the forecast 41% annualised revenue growth to the end of 2023 noticeably faster than its historical growth of 18% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 13% per year. It seems obvious that, while the growth outlook is brighter than the recent past, the analysts also expect Bicycle Therapeutics to grow faster than the wider industry.

The Bottom Line

The highlight for us was that the consensus reduced its estimated losses this year, perhaps suggesting Bicycle Therapeutics is moving incrementally towards profitability. They also upgraded their revenue estimates for this year, and sales are expected to grow faster than the wider market. Given that analysts appear to be expecting substantial improvement in the sales pipeline, now could be the right time to take another look at Bicycle Therapeutics.

Even so, the longer term trajectory of the business is much more important for the value creation of shareholders. At Simply Wall St, we have a full range of analyst estimates for Bicycle Therapeutics going out to 2025, and you can see them free on our platform here..

Of course, seeing company management invest large sums of money in a stock can be just as useful as knowing whether analysts are upgrading their estimates. So you may also wish to search this free list of stocks that insiders are buying.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.